The 19-member Paris Club group of creditor nations has invited Myanmar to talks on resolving overdue debts as the former military regime moves to overhaul its finances, according to the International Monetary Fund (IMF).
The authorities recognise that a successful arrears resolution is essential for Myanmar to re-engage with the international community and ensure debt sustainability, the IMF said in a report on its website. They aim to normalise relations with all creditors, supported by the programme.
The talks may help Myanmar settle US$11 billion (330 billion baht) in overdue debts that may constrain its ability to borrow funds to build roads, bridges and power plants. Japan, Myanmar's largest creditor, agreed last year to settle $6.6 billion in arrears and provide bridge financing for the government to resolve $953 million owed to the World Bank and Asian Development Bank.
President Thein Sein's moves to dismantle a fixed exchange rate and modernise the banking system are starting to boost the economy, the IMF said. Gross domestic product may grow 6.3% in the fiscal year ending March 31, up from 5.5% a year earlier, and reach about 7% over the next five years if reforms continue, the IMF said.
Myanmar owes $3.5 billion to nations in the Paris Club excluding Japan, the IMF said. The informal group, which includes the United States, Australia, Canada, Japan, Russia and 14 European nations, says it helps reschedule or reduce debt for nations that struggle to make payments.